APPLIANCES maker Concepcion Industrial Corp. (CIC) plans to spend P250 million to P300 million this year for new products and physical assets to boost its business amid strong momentum in the market.
“This year we’re allocating, in terms of basic physical allocation, roughly about P250 to P300 million. That includes new products, facilities and factories,” Raul Joseph Concepcion, chief executive officer and president of CIC, told reporters in a media briefing in Makati City on Wednesday.
He said CIC seeks to double the plant capacity of its refrigerator segment by 2019, noting that refrigerators are the “number one basic appliance” and is present in 15 million Filipino households. |
Asked if the amount already included spending for research and development (R&D), Concepcion stressed that investment in “innovation and technology are separate.”
“We’ve allocated P50 to P80 million for innovation and this is just the first stage of the investment,” he added, referring to CIC’s new subsidiary, Cortex Technologies Corp.
Cortex was formed to bring to life CIC’s vision of delivering appliances with cutting-edge technologies, particularly the Internet of Things (IoT).
“We are in very exciting time of growth. This is why we keep on innovating and adding capabilities because we think this market is going to grow much faster,” he said.
CIC is targeting to boost its air-conditioner business, banking on its newly created technology company for the Carrier Smart+Cool System, which reduces energy consumption by up to 40 percent.
Concepcion said the company is bullish of further growing this business because “only about 12 percent of all
families have air-conditioners.”|
One of the key drivers of growth is consumer spending, he said. “People want to go and eat out, and this means good for us—air-conditioning.”
CIC said its refrigeration and air-con business currently have an overall market share of 35 percent.
CIC reported earlier this month reported that 2017 net income rose 8 percent to P980 million on brisk demand amid strong economic fundamentals and rising income levels, while revenues surged 12 percent to P13.9 billion.